Nuclear plan still uncertain

Eskom is pushing ahead with plans for its nuclear power programme despite the Treasury’s lack of funding. Picture: Reuters

Eskom is pushing ahead with plans for its nuclear power programme despite the Treasury’s lack of funding. Picture: Reuters

Published Dec 4, 2016

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Cape Town - The new nuclear construction programme remains in doubt as questions on funding remain unresolved by the government.

It appears that the National Treasury does not have the funds for the project despite Eskom pushing ahead with plans to publish the Request for Proposals this month and wanting to start implementation of the project in 2025.

Reports emerged last week that the government did not have the money to fund nuclear energy. It was reported that the Treasury had told Eskom that its R350 billion guarantee for its construction programme would not cover nuclear energy.

The portfolio committee on energy in the National Assembly said this week that it would appoint a panel of experts to investigate the costs and other implications for nuclear energy.

The financing of nuclear power has been one of the sticking points for the programme.

The committee said the panel would conduct public hearings early next year. It would include experts who supported nuclear energy and those opposed to it.

President Zuma has said South Africa will undertake the nuclear programme if the scale and scope is affordable. It is this question of affordability that appears to throw the programme into a tailspin.

Finance Minister Pravin Gordhan said last week that the Energy Department had undertaken a feasibility study to determine the cost of nuclear power.

Eskom has since been appointed by the cabinet to be the implementing agent of nuclear energy.

Recently Eskom acting CEO Matshela Koko told journalists the nuclear programme would be implemented by 2025.

This flies in the face of the review by the Energy Department that postpones the implementation of the programme from 2022 to 2037.

In its initial plans, the department had anticipated that the first nuclear power plant would come on stream in 2022 and the last one in 2029.

But Gordhan said last week that it shared its findings on the cost implications for nuclear energy with officials from the department of energy.

It said the department had not yet completed a cost-benefit analysis on nuclear energy.

“As a result, a detailed assessment of the feasibility and the affordability of the nuclear new build programme cannot be undertaken at this stage,” said Gordhan.

This was his written reply to a question from David Maynier of the DA in Parliament this week.

Gordhan said several reports had been produced by the Treasury following studies. More work had still to be done.

“A full cost-benefit analysis must be conducted which must include a comprehensive social and economic impact assessment before the feasibility, affordability and procurement strategy can be properly assessed by the Treasury,” he said.

Weekend Argus

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